Strong growth fails to boost confidence

Published Monday 15 November 2010 3:27 pm

The UK transport and storage sector has experienced significant quarterly and year-on-year growth during the third quarter of 2010, according to the latest Business Factors Index from Bibby Financial Services. Even so, confidence is falling among many firms.

Turnover in the industry reached 109.1 in September, the second highest reading since the index began in 2007, and transport and storage is now the third best-performing sector in the UK.

However, these positive signs of growth are not reflected in the outlook of some business owners and managers operating within the industry, according to the index, which tracks the quarterly performance of business turnover among Bibby Financial Services’ 3,000 UK clients.

Half the firms said they had seen an increase in new customers over the past quarter. However, 40 per cent said they were finding trading conditions tough – up from 26 per cent in the second quarter.

The majority of the companies survey (80 per cent) said they were now taking greater measures to prepare their business for further economic challenges by managing supplier relationships more carefully.

The issue of access to finance was seen as an additional burden for owners and managers in the sector, with 40 per cent – the highest of all sectors – believing that the loosening of lending criteria would help stimulate economic recovery.

Edward Rimmer, UK chief executive at Bibby Financial Services, said: “From our research it is evident that the transport and storage industry is facing a difficult period. It’s therefore hardly surprising that the light at the end of the tunnel, in terms of economic recovery, seems so far away to many in the sector.”